[EXPERT TIPS] Fred Loya Insurance Review: Avoid At All Costs!
quick highlights
Fred Loya Insurance is for people who can’t find car insurance elsewhere.
Low Priced Coverage that includes some of the worst service in the insurance business.
Good luck if you have a claim. Notorious for having horrible claims adjusters.
In 1974, the first Fred Loya auto insurance office opened in El Paso, Texas.
Today, it is one of the fastest-growing car insurance companies in the nation.
They are known for selling car insurance policies that have the minimum legal limit of coverage.
Fred Loya is a ‘non-standard’ auto insurance company.
That means they cater to people who aren’t going to fit with the big car insurance providers, like State Farm or Liberty Mutual.
According to most of the Fred Loya insurance reviews we read online, the low prices come at a cost.
If you have a claim with Fred Loya Insurance, expect to have a horrible experience with your claim based on the Fred Loya Insurance reviews we found.
Most people who buy from Fred Loya Auto Insurance choose them probably because of the low price.
Many customers have complained in Fred Loya Reviews that coverage is generally not explained by the sales agent and benefits are not outlined.
As an insurance industry veteran, I have come to realize that if my client is hit by another driver and that person is insured by Fred Loya, then my client is going to have a really tough time.
Fred Loya Insurance Quotes are only affordable to people who buy the absolute minimum coverage required by law.
This is done for business purposes because Fred Loya is a small insurance company.
If they had to pay out on a lot of large claims, they may go out of business.
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By keeping their risk exposure low, by selling low amounts of coverage, they can stay financially solvent.
They also make it difficult to settle a claim, which is another tactic we consistently read about in customer reviews of Fred Loya Car Insurance.
Some of these people have been so frustrated that they have called for Fred Loya Insurance to be banned from the insurance industry.
With over 700 offices in twelve states, including New Mexico, Texas, and Ohio, it is also ranked 18th among the top 500 Hispanic companies.
Even though the car insurance agency has grown over the years, its goal is the same.
They are committed to selling extremely low cost auto insurance with minimum coverage.
In this Fred Loya review, you learn everything you need to know about this car insurance provider.
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How Does Fred Loya Auto Insurance Coverage Work?
Fred Loya Insurance markets to people who are willing to accept a lot of risk.
By that I mean the customers of Fred Loya are apparently unconcerned with having a large insurance claim.
We can only speculate as to why a person who could otherwise afford more coverage would opt to go with a very low amount of insurance.
Some clients of Fred Loya probably like the low rates.
Others might not have a choice, they are on the edge of being able to pay for food and they have to own a car so they can get to work, so buying anything more than the absolute minimum amount of car insurance is out of the question.
Then you have folks who just don’t believe in insurance as a concept, they buy the cheapest possible coverage because they think they won’t get a claim covered no matter who they buy insurance from.
Fred Loya is a great pick for any of these types of people.
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Fred Loya also caters to individuals with poor credit and those that need an SR-22 form filed.
Fred Loya provides the minimum coverage allowed under state law for a low premium.
Drivers that want additional protection can choose to pay extra for add-ons.
It includes collision and damage coverage and protection from injuries and medical payments due to an auto accident.
In reading this article, we noticed several people complaining about getting claims settled, so buying additional coverage may not be worth the upfront cost.
SR-22:
SR-22 is a form your insurance company will send the Dept. of Motor Vehicles. Drivers who receive a DUI will be required to add this form to their car insurance.
Minimum Coverage: In most states, only liability insurance is required to register your car. The minimum limits are usually less than $20,000 in Bodily Injury and $10,000 in Property Damage.
Minimal coverage policies are simple to understand.
The individual is covered for any damage their insured vehicle causes in an accident.
Auto insurance policies with additional coverage are more complicated.
To qualify for complete coverage, the vehicle must be free from previous damage.
Any changes to the policy, including phone numbers and addresses, must be supplied to a Fred Loya insurance agent for the coverage to stay effective.
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Does Fred Loya Offer Car Insurance Discounts?
Customers may be eligible for several discounts from Fred Loya insurance.
These discounts include:
Drivers with SR-22 filings can save money on car insurance premiums by taking these classes.
There is a fee to take these classes, which Fred Loya does not pay.
Other Discounts Include:
Keep in mind the anti-theft system discount only applies to policies that include Comprehensive and Collision coverage.
The discount isn’t always automatically applied, so be sure to check the quote before you buy.
Any driver that goes a year without claims may also qualify for a discount.
It depends on the type of coverage and the person’s driving record.
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How Much Does Fred Loya Auto Insurance Cost?
Fred Loya’s insurance agents only provide quotes over the phone or in person.
As a general rule, if you buy the lowest possible limits of liability insurance and avoid any additional coverage options, Fred Loya is going to be very cheap.
Every driver is different, and not all qualify for the same discounts.
Most people who end up buying from Fred Loya are only interested in the lowest amount of coverage possible to still have a valid vehicle registration.
Some policies, like full coverage, require a vehicle inspection.
Full Coverage:
This refers to a policy that provides coverage for liability and also physical damage to the vehicle listed on the policy.
The car must be free from dents, dings, and other signs it was previously involved in a traffic accident.
The baseline quote for minimum auto coverage is $433 annually.
Complete vehicle coverage is higher, and it’s one of the most expensive in the nation.
In 2021, the average cost for full coverage auto insurance is $1,733, without applying any discounts.
Fred Loya’s complete coverage is around $2,863.
It’s over $1,000 more than the national average.
This is a business practice. They don’t want to sell a lot of coverage because they would be forced to pay those claims.
Fred Loya is able to stay financially solvent because they price themselves out of selling very much coverage.
The high cost is also why most drivers covered by Fred Loya insurance choose the affordable minimum coverage rates.
It gives them the coverage they need without breaking the bank.
Comparison quotes are quick, easy, and free!
What’s The Cost To Add My Teenager To My Auto Policy?
The cost to add a teenage driver varies depending on each scenario.
Age, driving history, and the teen’s grade point average all affect the insurance rate.
Sixteen and seventeen-year-old drivers are the most expensive to add.
Fred Loya and other auto insurance companies consider driving experience when they’re calculating the rates.
Teens are also more impulsive than other drivers, and this causes an increase in rates.
Fred Loya does not list the exact cost to add a teenage driver to an existing insurance policy.
The national average for other insurance companies suggests annual rates can increase as much as 140% - 160% per teenage driver.
Parents can take advantage of discounts when they add a teenage driver.
Completion of a driver’s education class will lower rates.
Teens can also take a defensive driving course for an additional discount.
However, this class can only be taken once every three years and is usually used to drop a point off of a driver’s license.
Vehicles with airbags, seat belts, and anti-theft monitoring will also help lower insurance premiums for teenage drivers.
Something parents and teens don’t think about is high school grades. A higher grade average often results in lower insurance payments.
The above-average grades indicate the new driver isn’t as reckless or impulsive as others in the same age group.
Pros And Cons Of Fred Loya Insurance
There are always advantages and downfalls to any auto insurance company.
Fred Loya Customer Reviews & Complaints
According to the National Association of Insurance Commissioner’s website (NAIC), Fred Loya incurs an unusually high number of qualified complaints.
According to the statics cited on this page, they incurred 13 justified complaints in 2019, 21 justified complaints in 2018, and 18 in 2017.
This is a lot of justified complaints for such a small auto insurance company.
By comparison, State Farm, who is arguably the largest writer of auto insurance in the country, had a total of 2 justified complaints in 2019, 4 in 2018, and 2 in 2017.
You can see that Fred Loya is offering cheap rates, so as long as you don’t have a claim, you should be fine.
Here is a sad story...
Arnold was a client of ours a few years ago. He decided that the car insurance he was buying from us was too expensive.
So he got a quote from Fred Loya.
They did beat our price by a few hundred dollars. Arnold was only looking at price, so he didn’t notice the limits of coverage were also quite a bit lower than his previous policy.
One day, Arnold called up the agency and said he wanted to come back. Apparently, he had smashed his truck into another vehicle and totaled his own truck as well as the other person’s car. He was upset because the claims department at Fred Loya was not returning his calls and they were making the entire settlement process very time consuming and difficult.
He wished he had never gone with their policy because he owns a business and doesn’t have time to spend chasing a claims adjuster who is refusing to pay the claim.
Weak Website and Technology
Fred Loya does not accept online claims.
The insurance company also doesn’t provide online quotes.
All business must be done by phone or in-person; there are no exceptions.
It does make it difficult to update policies, file an insurance claim, or even receive a quote.
Drivers involved in a motor vehicle accident can only file claims during the day.
The offices are also usually closed on Sundays.
It’s frustrating to wait to speak to an insurance agent when an accident happens at night.
It is one of the major disadvantages of the company.
Confusing Coverage
The language in the complete coverage policies is confusing.
Some of it is also in the fine print.
Drivers do want to read the policy and ask any questions before signing. It’s easy to miss something that can invalidate a discount.
tips for success!
When shopping for car insurance, get three quotes. This will give you an idea of the going rate for insurance in your area.
Fred Loya Customer Likes
Drivers also find several reasons to choose Fred Loya auto insurance.
Very Low Premiums
Minimum coverage is less than $500 a year before any discounts are applied.
Individuals with pressing bills at home to pay or carry an SR 22 appreciate the company’s low rates.
Bad Driving Record? No Problem!
Another advantage, Fred Loya will insure almost any driver regardless of their history.
Something that not affordable insurance companies do is offer full reimbursement for vehicle rental fees.
Anyone with maximum coverage has the option to choose the add-on.
It covers vehicle rental costs without any charges to the driver. It’s a nice option to have when an accident occurs.
What Are Fred Loya’s Financial Ratings?
The parent of Fred Loya Insurance is Loya Insurance Group.
The financial rating firm AM Best currently does not have a rating for Loya Insurance Group.
This lack of financial data may be concerning to some policyholders.
Financial ratings for insurance companies are based on a single score that depicts the business’s financial stability.
The ratings are based on any financial hardships like an increase in claims, along with the company’s ability to survive in a tough economy.
How the business is managed is another factor used to determine where it ranks financially.
Some criteria commonly used to rank Fred Loya and other car insurance providers are:
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Fred Loya’s financial ratings aren’t immediately available, but it’s possible to develop an informed opinion based on the rating criteria.
The insurance company is quickly growing across 12 states.
The downside is the company only has one revenue stream.
Currently, Fred Loya only offers auto insurance.
The financial rating dips even lower when the number of policies written is compared against the variety.
Fred Loya primarily writes minimum coverage car insurance policies.
A financial rating is a holistic score that is meant to help guide consumers as they’re shopping for insurance.
It is not an evaluation of the company.
It only indicates its ability to pay out claims when there’s a high number of maximum policies being cashed in, with only minimum coverage going out.
Action Item: When comparing auto insurance companies, don’t decide based on price alone. Get two to three quotes, then call or chat online with the company and ask about their claims process. Does it sound easy and reliable? You can get started comparing quotes here.
Fred Loya Auto Insurance Reviews & Complaints
Fred Loya Auto Insurance does offer budget-friendly minimum coverage for most drivers, but the company does have several unfavorable reviews and complaints.
The three primary customer complaints focus on claims.
- Unsatisfactory claim offers and settlements
- Long wait period after a claim is submitted
- Claims often denied and need re-submitting
It’s also not unusual for an insurance company to have clients dissatisfied with how their claims are resolved. What is unusual is the number of complaints the insurance agency has received in the last three years.
Independent Review Firms Avoid Fred Loya
Fred Loya’s auto insurance reviews mention that the company isn’t rated by AM Best or J.D. Power.
Without the financial and customer ratings, it’s hard to compare them to other insurance providers.
It has prompted some reviews to suggest drivers choose another insurance company.
Fred Loya BBB Reviews
Reviews and ratings from the Better Business Bureau (BBB) aren’t great.
Fred Loya insurance BBB only boasts a C+ rating and an average score of 1 out of 5 stars.
It’s also an accredited BBB member.
It’s something drivers want to look at before choosing Fred Loya for their car insurance provider.
Out of 28 current posted reviews on the BBB website, the majority involve claims by drivers both insured by Fred Loya and competitors.
A common complaint is that the insurance company only approves 20% of the claim, leaving the remaining 80% the affected driver's responsibility.
Fred Loya Tries to Avoid Paying Claims
Some drivers with insurance from other providers have followed up their claim’s denial with legal representation.
Individuals with complete coverage from Fred Loya often find themselves paying for part of the repairs.
Other complaints center around the claims adjusters and office personnel.
Unfriendly attitudes and hang-ups in the middle of a call are frequently mentioned in the complaints.
don't be a dodo!
Watch out for this mistake!
Your time is valuable. If you have a claim, you want claims adjusters to call you back. Buying cut rate insurance might cost you thousands of dollars and a lot of your precious time.
It’s worth noting that a representative from Fred Loya Insurance does respond to each complaint.
It is the same form letter, but it shows that the company pays attention to what their customers have to say.
In Conclusion
Fred Loya is not the best auto insurance company, but it's also not the worst.
It is difficult to receive payment from a filed claim, even the standard 20% they usually payout.
Hours to file are limited, and online access is missing.
It is harder to get a quote or file a claim than with most insurance agencies.
The insurance company does come with a few benefits.
Minimum coverage policies are incredibly affordable.
Almost any driver can also qualify for coverage.
If credit scores are a problem or an SR-22 needed, Fred Loya is one of the few auto insurance companies here to help.
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